Cocoa prices continued to decline despite news that the world's largest cocoa grower is anticipating a slump in the upcoming cocoa crop.
Cocoa for September slipped 0.3% to $1,811 a ton on the ICE Futures U.S. exchange, on track for its sixth straight fall.
Continue Reading Below
The Ivorian Coffee and Cocoa Council said local flooding and bad weather persisting in Ivory Coast could create a 20% drop in cocoa output from October to December.
"One would think cocoa would pop up due to the news because any negative crop news would be positive for cocoa. But the traders and commercials believe that this news has been priced in and are not buying into the negative news literally," said Michael Kerensky, a trader at R. J. O'Brien & Associates.
Most analysts are still anticipating a surplus cocoa supply in the season that begins in October as the drop in output isn't expected to outstrip a slumping demand for cocoa.
The contract is entering a seasonal shift in which little reliable information about the upcoming cocoa crop creates low trade volumes and high volatility.
The cocoa market is looking ahead to the next quarter of cocoa processing data out of North America and Asia for indications of how recently low prices for beans have affected demand for the product.
In other markets, raw sugar for October was down 0.2% at 13.41 cents a pound, arabica coffee for September rose 0.7% to $1.2775 a pound, frozen concentrated orange juice for September was down 0.8% at $1.2895 a pound, and December cotton lost 0.6% at 67.33 cents a pound.
Write to Julie Wernau at email@example.com
(END) Dow Jones Newswires
July 12, 2017 12:10 ET (16:10 GMT)